What’s going on in the world…
Market opens higher after yesterday’s reversal erased most of Monday’s gains, and closed at the lows on the day. Global Markets were largely in the red overnight. The volatility continues as the correction has yet to be resolved. The DOW and S&P are on track for the first monthly decline in 10. The S&P is down nearly 3% in February, marking the worst monthly performance in 2 years. February is historically bumpy, and the 3rd worst month for stocks. New Fed Chair Jerome Powell testified on Capitol Hill emphasizing the strength of the US economy and maintained the guidance of future interest rate increases. The Market took the talk as if a 4th rate hike was coming. Adding to the recalibration process was weaker economic data this morning as Q4 GDP was revised down to 2.5% growth. That was a material slowdown from the 3.2% growth in Q3. This comes on top of the shrinking new homes sales report for January released yesterday morning. China reported some weak economic data too. The Market is trying to figure out how strong the global economy actually is, how sustainable earnings growth will prove and what the true price of money should be. Interest rates are lower again in early trading. The recalibration continues. Treasury Secretary Steve Mnuchin suggested a US re-entry in TPP is possible. An aluminum foil tax is the latest spat with China and the US. Dick’s Sporting Goods announced it will stop selling assault rifles in the United States. Amazon is buying home security company Ring, another move to own the home. Amazon is building an empire and competes with pretty much everyone. Crude oil is catching a bid, above $63. Gold is flat while the Dollar is slightly higher in early trading. The Summer driving season is expected to be the most expensive in 4 years. Gas prices should approach $3 per gallon across the country. They will be closer to $4 in California. It’s still 3 months away though. The final day of February is here. Hang on for the ride.
Have a great morning,